Family feud sparks revolt at grocery store chain

By DENISE LAVOIE / Associated Press

Posted:
07/26/2014 03:00:00 AM EDT

Updated:
07/28/2014 10:12:15 PM EDT

Market Basket employees Rees Gemmell, far right, and colleagues acknowledge passing supporters as they picket in front of the supermarket Thursday, July 24, 2014, in Haverhill, Mass. A decades-long family feud, which brought about the ouster of Arthur T. Demoulas as CEO of the privately held company, led to a worker revolt, customer boycotts and empty shelves in the grocery chain's stores in Maine, Massachusetts and New Hampshire. More than 100 Massachusetts legislators and mayors, Massachusetts Attorney General Martha Coakley, and New Hampshire Gov. Maggie Hassan have publicly supported the employees. (AP Photo)

WEST BRIDGEWATER, Mass. -- It's been called a David vs. Goliath story, a "Tale of Two Arthurs" and even the "ultimate Greek tragedy," but the characters in this drama are not Biblical or literary figures. They're grocery store owners.

A workers' revolt at the Market Basket supermarket chain has led to empty shelves, angry customers and support for a boycott from more than 100 state legislators and mayors.

Industry analysts say worker revolts at non-union companies are rare, but what's happening at Market Basket is particularly unusual because the workers are not asking for higher pay or better benefits. They are demanding the reinstatement of beloved former CEO Arthur T. Demoulas, who workers credit with keeping prices low, treating employees well and guiding the company's success.

The New England grocery store chain is embroiled in a family feud featuring two cousins who have been at odds for decades.

While earlier squabbles between Arthur T. Demoulas and Arthur S. Demoulas were fought in courtrooms, this dispute has spilled into the stores.

For the past week, warehouse workers have refused to make deliveries to Market Basket stores, leaving fruit, vegetable, seafood and meat shelves empty. Workers have held huge protest rallies and organized boycott petitions through social media, attracting thousands of supporters.

Customers are defecting to other grocery stores.

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In some cases, customers have taped receipts from competitors to Market Basket windows.

"We are going to go somewhere else from now on," said Soraya DeBarros, as she walked through a depleted produce department at the Market Basket in West Bridgewater this week. "I'm sad about it because of course I want to keep the low prices, but I want to support the workers."

Despite threats by new management to fire any workers who fail to perform their duties, some 300 warehouse workers and 68 drivers have refused to make deliveries. So far, eight supervisors have been fired. Massachusetts Attorney General Martha Coakley, who is running for governor, and New Hampshire Gov. Maggie Hassan have publicly supported the employees.

"If you had told me that workers at a grocery store would walk out to save the job of a CEO, I would say that's incredible. There is usually such a gulf between the worker and the CEO," said Gary Chaison, a professor of industrial relations at Clark University in Worcester.

Market Basket stores have long been a fixture in Massachusetts. The late Arthur Demoulas -- grandfather of Arthur S. and Arthur T. and a Greek immigrant -- opened the first store in Lowell nearly a century ago. Gradually, Market Basket became a regional powerhouse, with 25,000 employees and 71 stores in Massachusetts, New Hampshire and Maine.

The feud dates back to the 1970s, but the most recent round of infighting began last year when Arthur S. Demoulas gained control of the board of directors. Last month, the board fired Arthur T., sparking the current uprising.

Workers are fiercely loyal to Arthur T.

"You know the movie, 'It's a Wonderful Life.' He's George Bailey," said Tom Trainor, a district supervisor who worked for the company for 41 years before being fired last weekend over the protests. "He's just a tremendous human being that puts people above profits. He can walk through a store, and if he's met you once, he knows your name, he knows your wife, your husband, your kids, where they are going to school."

On Friday, board members said they will consider an offer Arthur T. made this week to buy the company.

"Consistent with its fiduciary obligations, the Board will evaluate and seriously consider this proposal, along with any other offers previously received and to be received," the board said in a statement it issued after a meeting.

The board also decried what it called the "negative behavior" of some current and former employees.

"It is now clear that it is in the interests of all members of the Market Basket community for normal business operations to resume immediately," the statement said.

As the board met, up to 10,000 employees, customers and supporters attended another protest rally at a Market Basket store in Tewksbury.

Employees said they believe the fight between the family members loyal to Arthur T. and Arthur S. is largely over money and the direction of the company. They say Arthur S. and his supporters have pressed for a greater return to shareholders.

Arthur T. and his supporters have focused on keeping prices low.

Many employees are distrustful of Arthur S. and two co-chief executives who were brought in from outside the company: Felicia Thornton, a former executive of the grocery chain Albertsons, and Jim Gooch, former president and chief executive at RadioShack Corp.

"I'm worried about my job," said Valerie Burke, a worker in the West Bridgewater store. "It's a great company to work for now, but we are worried it won't stay that way," she said as she picketed outside the store Tuesday.

Arthur S. has not spoken publicly, while Gooch and Thornton have communicated only through prepared statements. They assured workers in a statement that they are not planning drastic changes in the way the company is operated, and urged employees to return to work.

Steve Paulenka, who started in 1974 as a bag boy and rose to facilities and operations manager before being fired last weekend, said he sees no end to protests unless Arthur T. is reinstated.

"A big part of me doesn't like what's going on -- it's like breaking your favorite toy on purpose," he said. "But we'll get through this."

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